Politics (formerly Election 2012)

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Re: Politics (formerly Election 2012)

Postby Fridmarr » Mon Sep 09, 2013 6:12 am

Of course it isn't. There are tons of examples, the most obvious is paying for (or to more closely match gov't, borrowing for) training/schooling.

You're merely talking about spending money on something for which the result is that ultimately either income is increased or expenses reduced.
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Re: Politics (formerly Election 2012)

Postby Qeeze » Mon Sep 09, 2013 7:40 am

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Re: Politics (formerly Election 2012)

Postby Paxen » Mon Sep 09, 2013 8:13 am

Fridmarr wrote:Of course it isn't. There are tons of examples, the most obvious is paying for (or to more closely match gov't, borrowing for) training/schooling.

You're merely talking about spending money on something for which the result is that ultimately either income is increased or expenses reduced.


You can invest in a household. The government only has to spend.
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Re: Politics (formerly Election 2012)

Postby fuzzygeek » Mon Sep 09, 2013 11:16 am

Fivelives wrote:Wouldn't it be more feasible for the US to try and convince NATO to send in peacekeeping forces, set up a DMZ and split Syria up along currently controlled regions rather than opt for nearly unilateral "limited" military action?


As stated, NATO involvement has already been vetoed (and is almost always a horrible idea anyway). Also Syria's in the middle of a civil war -- the world unilaterally stepping in and setting up new borders has, historically, not worked well in the Middle East.

Fivelives wrote:Right now, the way I see it we're damned if we do and damned if we don't, regarding military action.


Pretty much. The problem with the situation is:
1) deterring the use of WMDs is good
2) supporting the rebels is not so good
3) blowing the shit out of Assad is de facto supporting the rebels

I mean, if Country A invaded Country B and Country A used WMDs, then it becomes fairly cut-and-dry that Country C can come in and blow the shit out of Country A in retaliation, yes?

When it's a Civil War it becomes considerably less clear. Should countries intervene when another country is blowing the shit out of its own citizenry? In some cases apparently yes (see: UN Peace Keeping Missions in various 3rd world countries. Also see how well those have worked out).

The argument is generally that destabilization in a country is bad for its neighbors (refugees, armed conflict on borders, etc.), so you quell an area to keep things from spreading. I am not certain how well this works, when there are no peaceable solutions to the underlying problems that lead to violence in the first place.

But anyway. Is some kind of intervention necessary? I'd argue so. I'd also argue that a sternly worded letter from the UN might be enough of a token effort in this situation (see: Iraq 1984-2001). It's a little odd that the subtext would be "it's okay to WMD your own country, but don't make us come over there."
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Re: Politics (formerly Election 2012)

Postby Klaudandus » Mon Sep 09, 2013 11:23 am

I never understood the blatant need of the US to play World Police.
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Re: Politics (formerly Election 2012)

Postby fuzzygeek » Mon Sep 09, 2013 11:55 am

The simple answer is self interest. A more accurate answer is considerably more complicated and prone to a lot of finger pointing and accusations of duplicity.

I'd be very curious to see what would happen if the US closed every foreign military base and suspended all foreign aid for a year.
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Re: Politics (formerly Election 2012)

Postby Fridmarr » Mon Sep 09, 2013 12:49 pm

Paxen wrote:
Fridmarr wrote:Of course it isn't. There are tons of examples, the most obvious is paying for (or to more closely match gov't, borrowing for) training/schooling.

You're merely talking about spending money on something for which the result is that ultimately either income is increased or expenses reduced.


You can invest in a household. The government only has to spend.


That's splitting hairs and still not true.  For instance if a couple decides to pay for daycare so that one of the spouses that was staying home with the kids can enter the workforce, they would accomplish the same thing.
 
The notion that the simple act of spending by a government can lead to prosperity is tenuous at best.  Just like a household, the government needs to be concerned with ROI.  I mean the government could buy 1 trillion dollars worth of lottery tickets all with the same number on them.  While that might make some ink, paper, and garbage handlers happy for some time, that's hardly going to result in a net positive.
 
I'm not suggesting that household economics and government economics (the topic that started this chain) are the same because there are significant differences.  This just isn't one of them. 

One of the more fundamental differences (and I haven't even seen it mentioned here, but I don't read this much these days so I may have missed it) is the concept of retirement.  People plan and spend for an eventuality that they won't be able to (or won't want to) work for money at some point.  Whether by planning on clearing debts when that age is reached or by investing for a residual income or both, there's no real equivalent to that in government. 
 
Business economics are a bit more comprable though.
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Re: Politics (formerly Election 2012)

Postby Paxen » Mon Sep 09, 2013 12:54 pm

Fridmarr wrote:The notion that the simple act of spending by a government can lead to prosperity is tenuous at best.  Just like a household, the government needs to be concerned with ROI. 


They are not the same thing. A household on its own will not significantly affect the rest of the economy. A government, on the other, can't help but have a huge impact. If they spend, money starts moving, and that generates economic activity.

The aggregate of all household spending has a similar effect on the macroeconomic level, but you can't control that with your single household. A government can.
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Re: Politics (formerly Election 2012)

Postby Fridmarr » Mon Sep 09, 2013 1:22 pm

What isn't the same thing? 
 
I never suggested that a single household would affect the entire economy.  I don't even know what the heck you are talking about at this point. 
 
As a way to illustrate a difference between the economy of a houshold and that of a government, you said that a household can not increase its income by spending money but that the government can.  I pointed out, that that is obviously false, because a household most certainly can spend to increase its income.  That is all.  
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Re: Politics (formerly Election 2012)

Postby Paxen » Mon Sep 09, 2013 1:58 pm

Fridmarr wrote:What isn't the same thing? 
 
I never suggested that a single household would affect the entire economy.  I don't even know what the heck you are talking about at this point. 
 
As a way to illustrate a difference between the economy of a houshold and that of a government, you said that a household can not increase its income by spending money but that the government can.  I pointed out, that that is obviously false, because a household most certainly can spend to increase its income.  That is all.  


I stand by my point. A governement can spend to get a macroeconomic effect which can be beneficial, while a household can't. They operate at totally different levels, so using analogies between a household economy and fiscal policy can be very misleading, even more than analogies usually are.

The point is that a government can effectively throw money away and get a positive result, which makes no sense whatsoever if you try to compare it to a household economy.
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Re: Politics (formerly Election 2012)

Postby Sabindeus » Mon Sep 09, 2013 2:41 pm

Klaudandus wrote:I never understood the blatant need of the US to play World Police.


Paladin answer: Those with power have a moral obligation to use that power to protect the innocent and make the world a better place.

The real answer is probably a lot more complicated, but that's at least the fundamental underlying principle.
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Re: Politics (formerly Election 2012)

Postby Fridmarr » Mon Sep 09, 2013 2:49 pm

Paxen wrote:I stand by my point. A governement can spend to get a macroeconomic effect which can be beneficial, while a household can't. They operate at totally different levels, so using analogies between a household economy and fiscal policy can be very misleading, even more than analogies usually are.

The point is that a government can effectively throw money away and get a positive result, which makes no sense whatsoever if you try to compare it to a household economy.


Standing by an incorrect assertion doesn't make it correct.  That a household can spend money to increase it's income is irrefutably true.  No one suggested that the spending of a single household will affect the economy of the entire country, that seems to be a ridiculous deflection to hide behind your incorrect statement.
 
That said, you are further incorrect to say that the government can just throw money away and still result in a net positive.  By and large, it can not, otherwise every government throughout history would have been exceedingly wealthy. 
 
The government gets money by taking it from the people who earned it or by borrowing it at interest and eventually paying it back by taking money from the people that earned it.  On its own, taking money from the citizenry is a net negative and depresses economic activity.  Now if that money is spent wisely then the government can certainly enable people to generate more wealth, thereby creating a higher tax base and increased income.  However, if it is just thrown away, then there is no increase in wealth (or not enough of it) to offset the original negative.
 
The notion that every dollar spent by government is a net positive, is demonstrably false.  Otherwise government wealth would grow ad nauseum at an ever increasing rate.  It's simply impossible.
 
 
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Re: Politics (formerly Election 2012)

Postby Brekkie » Sat Sep 14, 2013 2:16 pm

Fridmarr,

The counter-argument to that is the concept of deliberately induced, slow, predictable inflation.

If the Government prints money at a slow enough rate (relative to the overall size of the monetary supply) that it doesn't cause a price shock, you CAN effectively get increased economic activity for nothing.

Inflation favors people who owe debt (which generally means young people, and middle class working people). It does this by making their debt less large in absolute terms, which makes it easier to pay off. This increases young people's freedom of movement because they have the expectation that inflation will keep their debt manageable and prevent them from being in debt servitude for life.

It harms people who have a large net worth (generally old, wealthy people; "the 1%"). It does this because they are the ones whose money is being loaned. Inflation forces you to DO something with your money if you want to maintain your fortune. You have to continue generating wealth or your riches will slowly inflate away their value. This is not a big deal for the non-rich, because to a Middle Class net worth, the effects of inflation are fairly negligible. Middle Class families aren't living carefree lives off of their massive stock portfolios; whatever money they have to invest is purely a long-term strategy. It is more effective for a Middle Class worker to just put in a little bit of overtime than quibble over whether inflation is 3% or 2%.

This is pretty much THE reason why the US (and other currencies) originally came off the gold standard. Rich people wanted to keep the gold standard, because it would ensure they remained wealthy without effort unless they somehow squandered their money. Farmers and other regular people (who were burdened by debt) wanted to get rid of the gold standard (or prior to that, make dollars exchangeable for silver too, which had the same inflationary effect).


You are absolutely right about government spending needing to take ROI into account.
In the context of stimulus spending, this is referred to as a "multiplier".
Depending on whether the money is coming from and what it is being used on, it will have an economic multiplier of greater than or less than 1.0. A type of spending whose multiplier is greater than 1.0 generates more economic activity than a scenario where the money wasn't taxed in the first place. A payroll tax break is a good example of a stimulus that has a positive multiplier, because if working people get a little bit more money broken up in small chunks over time, they tend to spend it.
Conversely, a form of stimulus whose multiplier is less than one is effectively a bad thing for the economy, because it generates less economic activity than it cost. A good example of this "bad" form of stimulus would be big income tax breaks for the wealthy, because when wealthy people get to keep more money, they generally don't spend it, they throw it in their mutual fund, which generates little added economic activity.
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Re: Politics (formerly Election 2012)

Postby Brekkie » Sat Sep 14, 2013 2:28 pm

Klaudandus wrote:
Fetzie wrote:How many billions of dollars has the USAF wasted on the joint strike fighter (that will be ready for the scrap heap before the first one rolls off the production line)? That is the kind of project that needs to be hit by the sequester, not school funding or public defenders.


Completely agreed. Specially since the pentagon had to lower the bar so the plane would meet their requirements.
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People give Defense technology programs a lot of flak (no pun intended) for coming in behind schedule and over-budget, but that isn't entirely fair.

Keep in mind the context that these sort of programs are on the cutting edge of science and technology as we know it. They are often attempting to build things that have capabilities that have never existed before. There is a reason why Defense is a big driver of technological progress; they are constantly pushing the frontier of what the hardware is capable of.

That said, yes there is a lot of mismanagement and inefficiency in DoD acquisitions. At the end of the day though, the US military's technological sophistication is often a generation (or more) ahead of any other country in the world.
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Re: Politics (formerly Election 2012)

Postby Brekkie » Sat Sep 14, 2013 2:32 pm

Klaudandus wrote:Perhaps, but that hasnt stopped congress to get money from lobbyists for their campaigns and proclaim that their 150K a year is not enough salary for them, quickly forgetting that the avg household income is barely a tick over 50K, and that 1.5 million households live in extreme poverty, where they subsist on less than 2 dollars a day.


Yes, but these are also not average people. Most of them come from privilege, went to Ivy League schools, and have qualifications that would be getting them high 6+ figure salaries in the private sector. If Senator John Smith wasn't a senator, he'd be a CEO or an investment fund manager or the head of a law firm, not a blue collar worker making 50k.

So the opportunity cost of running for office is often large.

Also keep in mind that Congressmen have fairly modest budgets for travel and hiring staff. Giving a Congressman a larger salary enables them to potentially take an another staff aide to do research or for them to do some foreign travel, which helps them be better informed.
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